Among the most remarkable findings that have emerged from the analysis of complete genome sequences is that bacteria that become associated with eukaryotic hosts undergo a process of genome decay, which occurs both through the mutational inactivation of genes and through deletions that encompass large regions. Gene loss and genome size reduction are prevalent among pathogens and symbionts, and appear to be as crucial as gene acquisition to the evolution and diversification of bacterial lineages. The global aim of the proposed research is to investigate the process and consequences of genome degradation by addressing two general questions: (1) What forces act in the formation, transcriptional inactivation and elimination of pseudogenes in bacterial genomes, and (2) What factors are responsible for the process of genome reduction and reorganization? Until recently, inactivated genes were thought to be exceedingly rare in bacterial genomes; however, the elucidation of complete genome sequences has revealed that many pathogenic bacteria contain hundreds of pseudogenes, By focusing on closely related pathogenic and free-living species, the proposed work will investigate how pseudogenes arise and persist in bacterial genomes. Although these inert genes have been previously thought be of no consequence to an organism, their maintenance may well be detrimental, and we will test whether selection acts to silence certain sequences. To investigate the dynamics of bacterial genome degradation, we will develop and implement new bioinformatic methods to reconstruct the process of genome contraction and reorganization, and examine how certain initial events have influenced the evolutionary trajectory of host-associated species. Cumulatively, this research has the potential of revealing new selective mechanisms acting on bacterial genomes. And because the processes examined and questions considered by this proposal are common to diverse life forms, this work will have broad impact on the interpretation of genomic information from organisms having very different ecology, lifestyles and genome organization.